It was 9 December 2010, the day the tuition fees bill was passed by the House of Commons. By the Whitehall entrance to Parliament Square, young people were still clashing with riot police, trying to force their way out of the kettle. Outside the Treasury building, a mobile sound system – no more than a speaker in a trolley – pulled up, a trail of smiling young protesters following its trail of dancehall, hip-hop, R&B, pop, dance and grime. One teenager climbed on top of a dustbin to dance, ripping his shirt off despite the freezing temperatures; another did the same, facing him, 10 feet away. "It's a dance-off!" shouted some kid. Darkness fell over the Palace of Westminster, and hundreds of young people danced around these convulsing figures, silhouetted against the dark blue gloaming, lit only by burning placards, and the night lights on Big Ben.

One track stood out, its reception so raucous, so euphoric, it was rewound and played again – and again, and a fourth time. Lethal Bizzle's Pow! (Forward) is a phenomenon, a 21st-century anthem with a life of its own. The NME review on its release in 2004 captures a sense of its impact: "Once in a generation, a record comes along that causes people to sit bolt upright, a rallying cry to the masses, a barometer of social discontent that turns venues into mosh-crazed riots. In 1977, it was the Sex Pistols' God Save the Queen. In 2004, it's Lethal Bizzle's Pow! (Forward)." It's not an unfair comparison – and Malcolm McLaren would surely have loved to have seen his proteges provide the soundtrack for disaffected youth storming Her Majesty's Treasury, as they did that night in December.

Like punk at its best, Pow! is a breathless three-minute assault of sheer adrenaline. It starts with an explosive introduction from Bizzle, before a frantic passing of the microphone from one MC to another – each has only 16 bars to make their mark, before their fleeting shot at the limelight is over. It's like the world's fastest talent contest. Falling off a building. While on fire. After building a phenomenal buzz on the club scene, it charted at No 11 in Christmas week 2004, at a time when grime was still very much an underground genre.

The lyrics may be a litany of aggression, but the tone – and the crowd reception – is gleeful, liberating. "How you gonna buss if there's no room?" MC Fumin asks on the song's opening set of bars; "buss" meaning to fire a gunshot, bust a move, or strike out, express yourself – find space and freedom. Grime in its first flush of youth was thrilling because it was claustrophobic, a hectic cacophony of beats and synth stabs, channelling the high-rise tension of the tower blocks, the limited horizons, and possibilities. But just like real claustrophobia, it demands freedom – and space.

It was a remarkable setting for a grime rave. Surrounded by government buildings and overlooked by statues of Nelson Mandela, Winson Churchill and Abraham Lincoln, protesters kettled in Parliament Square had little else to do but chant, smash windows, and make their own entertainment. They moshed, danced around, and threw their hands up to dancehall, American R&B and hip-hop, UK funky, dubstep and grime.

Lots of other music has cropped up as a soundtrack to the student protest movement, but none of it provoked a reaction like this soundsystem. What was extraordinary about this was the same thing that was extraordinary about the presence of thousands of under-18s on the protest: their spontaneity. No one had organised them, or expected them to protest, just as no one had programmed this playlist; instead requests were called out, the jack swapped from one teen's MP3 player to another.

"The impact, the energy, is like no other," Lethal Bizzle says, reflecting on the persistence of Pow! six years after its release. "When you hear it out somewhere for the first time, and you see the reaction, you're sold straight away, and you want to know what the fuck this song is. DJs used to say to me, 'I don't know what to play to follow that record – it's too much." Tim Westwood once complained: "You can't play a hip-hop tune after Pow! It's like a volcano erupting." When it played on Notting Hill Carnival's Rampage sound system, it led to trees snapping, as revellers who had positioned themselves in their branches responded to its energy.

For Bizzle, Pow's riotous energy is a source of great pride – especially now that energy has a physical manifestation again. "It's a beautiful thing," he says of its adoption as a protest anthem. "It just shows the power." He pretends to address David Cameron: "Who's really got the power? You've got thousands of people running around, destroying London – and you're meant to be the prime minister." Bizzle has previous with Cameron, which may explain why he keeps addressing him directly. In 2006, as leader of the opposition, Cameron addressed Radio 1's playing of hip-hop and grime with the kind of nuanced understanding of art we've come to expect from Conservative MPs: "Do you realise that some of the stuff you play on Saturday nights encourages people to carry guns and knives?" Cameron said. Bizzle responded in a Guardian article memorably headlined "David Cameron is a donut", and the spat continued in a Cameron-penned piece in the Mail on Sunday which accused the MC of "talking rubbish".

"Don't dismiss us," Bizzle says, echoing the message of his "donut" piece. "We've got more power than you have on the youth. You're a millionaire guy in a suit, your life is good – you can't relate. These kids can relate to people like myself, Wiley, Dizzee, Tinie Tempah, Tinchy: we're from the council estates, we lived in these places where they live, we know what it's like. We're the real prime ministers of this country."

While Pow! was a soundtrack to a riot in Parliament Square, it had already come close in its first occupation of the zeitgeist. It developed a fearsome reputation in 2004, becoming an entirely novel club phenomenon: "A lot of these urban clubs had never seen anything like it before," Bizzle says, likening the scene to a rock mosh pit. "But club owners didn't get it, so they started putting signs up saying, 'Don't play Pow!' I couldn't perform at an urban club for over a year, just because of Pow!"

"All Lethal B tracks are banned from this venue (including instrumentals)," read a sign in one club, a testament to the power of the song: even the instrumental version of Pow! was considered too incendiary. "Before we even touch the mic, when people hear those opening beats, they're going crazy," Fumin said in 2005.

"It was such a big 'fuck you' to people who didn't want to give us a look in," Bizzle says, reflecting on the lack of interest from record companies in grime after Dizzee Rascal's seemingly isolated Mercury prize win for Boy in da Corner. "It was like: 'Fuck it, we'll just do our own thing anyway.' As a unit, we're more powerful than any record company."

The relationship between grime and the mainstream could scarcely be more different in 2011 – and nor could the recording of Pow 2011, a forthcoming reworking with a whole different selection of grime all-stars: "When I made the first one," Bizzle says, "I made one phone call, and everyone came to the studio the next day. They had fuck-all else to do." Owing to tour, media and studio commitments, tracking down the MCs for Pow 2011 (including Wiley, Chipmunk, P Money, Kano, and JME) took a little longer.

It would have been completely unthinkable as recently as two years ago, but the Radio 1 playlist this week features singles by five different grime MCs – four on the priority A-list. Meanwhile, Dizzee, Tinie Tempah, Chipmunk, Roll Deep and Tinchy Stryder have scored 11 No 1 singles between them since 2009. And yet those hits are a million miles from the delirious rebel energy of Pow!

"They have to compromise to move forwards," Bizzle admits, "but it's not really the artists' fault. Grime is still a genre the corporates don't understand, and don't have any control over. And that's the most important thing in their world: control." The other thing that's held back that raucous energy, he says, is its banishment from London clubs. "When we first started to create this thing, it was about going along to clubs, people singing along to the songs, going crazy to the beats – seeing girls skanking out to hard, bouncy, grimey beats. But the whole dance and enjoyment side, the club side, just got taken away."

The operative word there is "taken". The same Metropolitan Police force kettling the kids in Parliament Square were responsible for the use and misuse of Form 696, a piece of paperwork described as "draconian" and "absurd" by John Whittingdale, the Tory MP tasked with looking into it – he recommended it be scrapped in 2009, but by then it was too late. It had been used to target black music nights in London ("Is there a particular ethnic group attending?" asked one question on the form), shutting down grime raves before they even happened, and snuffing out the genre as physical, dynamic club music. "The music just became YouTubey, iPody, in-your-house listening, rather than for the club," Bizzle says, ruefully. "This sound, this whole grime thing, is supposed to be dance music."

A couple of days after we meet, I send the YouTube video of the kids dancing to Pow! in Parliament Square to Bizzle. He calls back immediately: "Fucking hell, I got goosebumps watching that. When you're on stage it's a different kind of feeling, but that video, with nothing pre-arranged, just seeing it from the outside looking in, you're actually seeing how they really feel about your music. Singing along word for word, rewinding it – it's inspirational. We don't even realise how powerful we are."

He sounds like he's picked up on some of the anger of the videos of the protests, too. "It's a big 'fuck you' to those sods as well, and to the cuts. David Cameron is still a donut. I told him six years ago what's going on, and he tried to neglect it. Now it's on his front doorstep. He should really be scared. I've got more power than he has, when it comes to those kids: they're singing my song in his front garden."

The only MC who Bizzle wanted to appear on Pow 2011 who wasn't available was Tempz, whose underground hit Next Hype is the other grime anthem heard repeatedly on the winter protests. Like Bizzle, Tempz understands the power of this kind of song – political in its spirit, rather than through earnest lyrics. "It's not about the [lyrical] content, it's about the energy and aura," he says. "The persona I portray gives a voice to those who use it as a way of expression."

Back in 2006, explaining his unexpected attack on grime and hip-hop, Cameron said he was trying to set an example, that he wanted more people to have "the courage to speak up when you see something that is wrong", despite the fact that this would "get a lots of bricks thrown at you". Maybe the grime kids were listening to him after all.